Wonderful looking truck! You might try PB blaster in place of WD-40, I've had good results with it, but you're into way more than I have attempted to take on.
You have a really good point about being able to use the truck without worry of a few scratches or dents. Many of us (myself included) over-restore a truck, and are afraid to leave it out in the rain or haul a load of mulch with it. That's important because it greatly limits how you use your truck.
With your truck, my approach would be to keep it patina & original. Replace the bones that are not solid. Make the drivetrain and suspension operate like it should. New wiring & bed floor. Spray the interior, new gauges, seat, headliner/door panels/floor mat. Maybe consider reasonable safety upgrades like disc brakes and seatbelts. Clean up the sheet metal and keep the nice rustic patina paint and wheels. New tires of course.
Also...there are a couple of rebuildable 261's for sale in the For Sale forums...just saying
